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Saturday, February 24, 2018

During a forum on Budget 2018 earlier this week, Najib said that tolls should be abolished, adding that wherever possible he would look into unraveling the legacy problems caused by toll concession agreements.

Malaysians shouldn’t fall the empty promises of the Prime Minister whose track record has proven that he has zero commitment in abolishing these tolls.

It isn’t the first time Dato’ Seri Najib Razak promised to abolish tolls or lower toll rates. In Barisan Nasional’s manifesto for the 13th General Election, Najib promised the gradual reduction of intracity tolls within 5 years. Yet, 5 years on, not only has this promise failed to be delivered, he delivered the exact opposite.

In October 2015, 18 tolls operated by 11 concessionaires were allowed to increase their fares with some even going up RM2.30 overnight. These included toll routes such as the LDP, SMART Tunnel, MEX, AKLEH and NPE in the Klang Valley as well as the Senai-Desaru Highway in Johor and the Butterworth Outer Ring Road (BORR) in Penang.

In response to this, Najib turned around and said the the government had no choice but to allow the toll fares to increase because preventing it would require massive compensation payments. The Prime Minister went on to threaten Malaysians that taxes would have to be increased if the government were to abolish tolls.

The Prime Minister’s threats have proven true because when the government did remove certain tolls, they paid exhorbitant compensation equivalent to the amount of toll these concessionaires would have collected anyway!
When the Batu Tiga, Sg Rasau, Bukit Kayu Hitam and Eastern Dispersal Link (EDL) tolls were removed last year, the government will be paying RM2.2 billion for the first 3 tolls. For the EDL, the government will reportedly be paying a yearly compensation of RM70 million.

The above means, Najib “abolish tolls” or not, the BN government would always profit the concessionaires. Malaysians would either have to pay for the tolls directly, or pay for them via taxes paid to the Government.

Most hypocritically, the Prime Minister had only recent on 3rd December criticised Pakatan Harapan’s plan to eliminate highway tolls and reintroduce petrol subsidies will increase air pollution in the country. So did Najib temporarily change his mind to fish for votes in the impending General Election, just as he did in 2013?

Pakatan Harapan believes in the rule of law and the sanctity of the contract signed between the Government and the toll concessionaires. The provisions of the contracts allow for the Government to expropriate or buy back the concessions at cost, subject to a minimum return for the concessionaires for the past years of operations.

Barring exceptions, the agreements do not at any point in time require the Government to compensate these concessionaires for future profits. Why is the BN Government so adamant in ensuring these toll concessionaires are paid their future profits at the expense of Malaysian tax-payers?

All this is proof that Najib’s ‘promise’ to abolish tolls is just another empty promise by a Prime Minister and government desperate to hold on to power. Malaysians should not fall for these empty promises and should not forget the government’s own inability to deliver on the same pledge that it had made 5 years ago.

Friday, February 09, 2018

Earlier this week, Mydin owner Datuk Ameer Ali Mydin had said that though the Goverment’s published GDP figures showed strong growth, consumers seemed to be spending less and less on grocery shopping. He suggested that Malaysians just did not seem to have the same amount of money to spend as before, even though the economy has been growing.

Mydin’s comments quickly drew responses from members of the Government, including Minister in the Prime Minister’s Department Dato’ Seri Abdul Rahman Dahlan who was quick to defend the Government’s economic measures. He said that hypermarket sales only made up 8% of total retail sales, which had seen overall growth both in terms of volume and value. He further added that Malaysians did indeed have more money to spend as highlighted by increases in domestic tourist expenditures as well as tourist spending abroad.

Dato’ Seri Rahman Dahlan’s dismissive attitude towards Mydin’s claim shows just how out of touch the BN Government is from the daily struggles faced by average Malaysians. If even low-priced hypermarkets like Mydin are facing weakened consumer demand, where does the Minister expect Malaysians to be buying their everyday groceries? Does he think Malaysians are going abroad to do their groceries?
Last November, 5 Giant hypermarkets were shuttered by owners GCH Retail (Malaysia).The 2017 Malaysia Retail Industry Report, also noted that consumers were less likely to spend money in the past year owing to the increasing cost of living. The same report noted that hypermarket sales in general had shrunk 3.1% in the first 3 quarters of 2017.

Accordingly, Malaysian consumers were found to be more frugal and judicious with their spending opting to make smaller purchases at different stores to make the most out of the various discount and offers provided by different stores.

All the above information is consistent with the Government’s own statistics. Inflation last year was the highest we’ve seen in years, averaging 3.7%. In particular, food and non-alcoholic beverages saw an increase of 4% over the past year. Regardless of whether someone is shopping in a hypermarket or a pasar tani, these price increases are present everywhere.

The Government should not be flaunting the spending statistics of Malaysians who can afford to travel abroad as proof that all Malaysians are better. Worse, they should not be dismissing the very real and loud complains of average Malaysians who struggle to even afford their daily groceries.

If the BN Government has no sympathy or empathy for the ordinary men on the street, it is time for them to get the boot. Malaysians deserves a government that looks out for the interest of all Malaysians and does not dismiss the real issues being faced everyday.

Thursday, February 08, 2018

This Sunday’s cover story in UMNO-owned newspaper Berita Harian (BH) proudly declared, “harga kereta turun” (car prices decrease), reporting that car prices had dropped 13.1% as a result of the government’s automotive policies as well as the strengthening ringgit.

To further drive home the point, the accompanying full-page reports in the paper carried the headline “Menepati Janji Manifesto BN” (fulfilling the promises of the BN Manifesto. It was accompanied by an infographic comparing prices between 2013 and 2018 for different models of cars owned by Malaysians. The graphic suggested that prices for the various local, Japanese and European cars had decreased significantly between 2.25% and 20.77% since 2013.

However, a lengthy report on specialist automotive blog paultan.org showed just how misleading the report by Berita Harian was. They noted that the comparisons made by Berita Harian compared different variants for the same model and used inaccurate pricing information.
For example, the BH article had compared the 2013 Perodua Alza’s 1.6 SE Manual model with the 2018 Standard model to show a 14.18% reduction in price.

For the Proton Exora, the newspaper had even used an inflated price for its 2013 comparison to further exaggerate the decrease. Instead of using the original price at 2013, it used the 2016 price, which came after price increase across the range. Worse, the report even included insurance for its ‘2013’ price whereas the current price stated does not include insurance.

The comparisons provided were at best between apples and oranges, and at worst, comparing fake apples with real oranges.

In the last elections, one of Barisan Nasional’s key manifesto points was that car prices would decrease 20-30%. The Berita Harian report was unabashly singing praises of the BN Government’s purportedly successful delivery of this promise.

However, the findings by paultan.org proved the complete opposite.

Here’s a simple question for the Minister in the Prime Minister’s Department, Datuk Seri Azalina Othman who has been given the responsibility to table an anti-fake news bill in the next parliamentary sitting – will she instruct MCMC or even the Home Ministry to take action against BH for publishing the outrageous fake news? If she doesn’t, then it is clear that she is not sincere in ensuring an anti-fake news bill which is fair, and which will not be abused by the BN government to punish opposition critics and whistleblowers.

Tuesday, February 06, 2018

Yesterday, Bank Negara (BNM) Governor Tan Sri Muhamad Ibrahim tried to provide a justification for the central bank’s outrageous purchase of 55.79 acres of land for approximately RM2 billion from the Federal Government. On the 4th of January, BNM announced that is had acquired the land for the development of a new financial education hub.

Tan Sri Muhamad Ibrahim said that the Bank wasn’t forced to buy the land by the government and instead it was BNM that requested the government to sell the land to them. Tan Sri Muhamad said that the deal between BNM and government was an “arm’s length agreement”, which is to say that both parties were acting in their own interest without any pressure by the other party.

As reported by the Edge Weekly in January, following Bank Negara’s announcement of the deal, many industry observers had found the purchase puzzling because it was rare for a government agency to buy land from the government more so at a market price. This is especially so when the land is intended to be used for the development of an education hub, rather than a commercial property. Land acquired for public universities are usually transferred at a nominal rate, while the land purchased by BNM works out to approximately RM823 psf.
The question must hence be asked? Why did the Governor not apply for the land at nominal rate? This is especially since the education hub is not a commercial venture? Even 1MDB for example, secured more than 500 acres of land at nominal or heavily discounted value from the Federal Government for commercial purposes.

Hence Malaysians cannot be blamed for suspecting that the entire transaction is a blatant attempt by the Federal Government to raid the Bank Negara coffers.

It also does not escape notice that the timing of the transaction and payment coincided with time 1MDB had to make it US$600 million second instalment payment to IPIC at the end of last year.

Despite questions being asked by the media, analysts, critics and even Members of Parliament, both 1MDB and the Ministry of Finance (MoF) have refused to clarify the source of funds for the above payments by 1MDB. The question is very important because we all know that 1MDB is effectively insolvent and Malaysians have the right to know if the MoF utilised tax-payers’ funds to further bail out 1MDB.

Hence, the Bank Negara Governor Muhamad Ibrahim “keep an arms length” nonsense is completely not credible and fools no one. Why should it be arms length in the first place when the land was not intended for Bank Negara to make a profit? Until these questions are properly answered, Malaysians certainly cannot be blamed for believing that Bank Negara allowed itself to be raided by the MoF in order to bail out 1MDB.

Earlier this week, Dato’ Seri Najib Razak announced that the government is looking into introducing laws to curb fake news which is a threat to political stability and public order. The Prime Minister said the move was necessary because the people could be instigated to hate the government or commit something like uprisings due to the influence of fake news.

However, it could not have been more ironical that the biggest purveyor of fake news today is none other than the Prime Minister himself.

However, in the BNM scandal, no one was accused of pocketing the money.

However, in the case of 1MDB, the whereabouts of the RM42 billion, or a substantial portion of it is unknown and/or unverified. In fact, if indeed Dato’ Seri Najib Razak was telling the truth, the question must be asked, why did the Cabinet classify the Auditor-General’s Report on 1MDB under the Official Secrets Act?

Or can Dato’ Seri Najib tell us where US$940 million worth of “units” is currently parked after the original custodial bank, BSI Bank was shut down?

If all monies are indeed properly accounted for in 1MDB, why is it that 1MDB has failed to produce a single audited financial statements since March 2014? In fact, it was the missing funds highlighted by none other than the United States Department of Justice (US DOJ) which led Deloitte Malaysia to withdraw their endorsement for 1MDB’s March 2013 and 2014 accounts. This means that 1MDB doesn’t have any properly audited financial statements for the past 6 years!

It could not be further ironical that Dato’ Seri Najib was lying through his teeth about 1MDB’s RM42 billion debt in front of 1,200 Muslim religious and village leaders who were about to depart for their holy pilgramage in Mecca.

Since the US DOJ exposed the money trail originating from 1MDB into the personal bank account of Dato’ Seri Najib, the Prime Minister has refused to confirm or deny the allegations. The US DOJ showed how approximately US$732 million was laundered into his account with Ambank between 2011 and 2014.

The US DOJ further showed how some of these funds have been subsequently used to acquire a US$27.3 million pink diamond pendant for his wife, Datin Seri Rosmah Mansor as well as a US$250 million luxury yacht by Jho Low.

In addition, there was also the sum of US$238 million from 1MDB which found its way to Datin Seri Rosmah’s son, Riza Aziz’s company in the United States, Red Granite Capital.

The above does not yet include billions of dollars of other assets, including private jets, luxury properties all around the world and rare expensive masterpieces, which were in the process of being seized by the United States government. These assets were deemed assets acquired via illegally laundered funds which originated from 1MDB.

Worst of all, all our questions relating to all of the above have been rejected by the Parliament Speaker so that Dato Seri Najib Razak need not be accountable to Malaysians. It cannot be more obvious that the Prime Minister has plenty to hide.

1MDB proudly announced that they had made their final US$602.7 million or RM2.4 billion settlement payment to Abu Dhabi’s International Petroleum Company (IPIC) on 27 December, four days ahead of their deadline.

The problem is, we all know 1MDB is completely insolvent. So Malaysians are rightly concerned as to how 1MDB paid its latest instalment of their debt. All that is stated in the official 1MDB statement is that the payment is funded through its “on-going rationalisation programme”.

No one of course, has a clue as to what the “rationalisation programme” entails.

What is more interesting is the carefully planted leaks to The Singapore Straits Times (SST) to reveal that the funds to repay IPIC came from the sale of investments in financial instruments and stakes held in two 1MDB-related entities that own tracts of land in Penang and Pulau Indah, Selangor. The report merely identified the anonymous buyers as “concerns ultimately controlled by Chinese state-owned enterprises”.
This is not the first time SST had carried out a hatchet stories which helped cover up some of the 1MDB’s financial shenanigans. When the Bandar Malaysia sale to an Iskandar Waterfront-led consortium was terminated out-of-the-blue by the Ministry of Finance, it was SST which created a media maelstorm by reporting on 9 May 2017 that “Government officials and financial executives close to the situation told The Straits Times that negotiations with the Dalian Wanda Group to take a central role as master developer have reached an advanced stage…”

“Malaysian government officials noted that the new deal would be substantially higher than the previous RM12.3 billion valuation tag for the entire project. According to financial executives familiar with ongoing talks, Wanda has proposed to use half of the development for tourism and entertainment-related ventures valued at roughly US$8 billion,” the Singapore paper added.

The above proved to be a hoax of course, because when Dato’ Seri Najib Razak met Wanda a week later, he came home empty-handed – without even a face-saving “Memorandum of Understanding (MOU)” signed.

The current SST report is similarly couched in the same language. SST claimed that “Malaysian government officials declined to identify the buyers in the real estate transactions but one financial executive close to the situation said that the equity interests in the 1MDB real estate entities were acquired by "concerns ultimately controlled by Chinese state-owned enterprises". The executive declined to elaborate.”

The SST report was inevitably picked up by nearly all local media outfits. This clearly served the interest of 1MDB which would want to avoid prickly questions on how they found the funds to repay IPIC.

The question really is, if 1MDB has really succeeded in disposing of its controversial properties in Pulau Indah and Penang to China-owned state enterprises, why is there absolute silence from official sources? Dato’ Seri Najib Razak and 1MDB would have been carrying out victory parades for proving their critics wrong, as they did in the past.

Surely if the companies owning these parcels of land were sold for billions of ringgit to foreign investors, from China or otherwise, official transactions would have taken place and the information would be publicly available.

More curiously, these parcels of land in Selangor and Penang were purchased by 1MDB for RM294 million and RM1.1 billion respectively. Critics were aplenty in citing that both parcels were purchased at inflated prices. However, even so, the combined purchase amounted to less than RM1.4 billion.

Hence if the SST report were to be true, then it begs the question as to which Chinese state-owned enterprises would pay an outrageous RM2.4 billion for these parcels, which in-turn allowed 1MDB to repay its second loan instalment to IPIC? Or is it more likely that it is another hoax to evade disclosing the fact that it was really the Ministry of Finance, which directly or indirectly, repaid both instalments amounting to US$1.24 billion to IPIC?

Monday, January 08, 2018

The Edge reported yesterday of the Ministry of Finance’s takeover of the 106-storey 106 Exchange Tower through the company MKD Signature. The 3.42 acres of land for the project was previously acquired by Indonesian conglomerate, Mulia Group for the sum of RM665 million.

The 106-storey Exchange Tower was initially proof of 1MDB’s success with the TRX project as it was a wholly-owned foreign investment by Indonesia’s Mulia Group. However, news of the transfer of a majority stake ‘back’ to the Malaysian Government goes to prove that there is something extremely fishy going on.

Why is it even necessary for the Government to use tax-payers’ funds to get involved in another mega-property project? Didn’t the Second Finance Minister, Dato’ Seri Johari Abdul Ghani announced a Cabinet decision to freeze all high-end commercial and residential projects? Why is the Ministry of Finance participating in the aggravation of the property glut in the country?

More importantly, if Mulia Group had paid RM665 million for the land, the question is how much did the Ministry of Finance pay to acquire the 51% stake in the project?
The complete lack of transparency over the deal which would involve hundreds of millions of ringgit, possibly to the tune of billions, raises suspicions that it is really another one of the series of continued bailout of the debt-stricken 1MDB.
Was there for example, a secret ‘put option’ in the sale and purchase agreement between the Mulia Group and 1MDB, where the latter is obliged to buy back a majority stake from Mulia Group with a higher price at a later date? And because 1MDB obviously has no money to buy back the stake from Melia Group, was the Ministry of Finance was forced to step in to bailout 1MDB?

It should also be noted that this would be the second tract of 1MDB's TRX land that has been bought by MOF companies. It was previously disclosed in Parliament that MOF-owned company Aroma Teraju had purchased another tract of land at the Tun Razak Exchange (TRX) development in 2015.

Last year, I had asked several times in Parliament for the land area and purchase price of the land by Aroma Teraju. However my question was repeatly shot down because of the purported confidentiality clause in the purchase agreement was with two companies wholly-owned by MOF.

Why hide behind the veil of secrecy when the parties involved are entirely owned by the Government? Is it because the Ministry of Finance will look utterly stupid for buying back tiny parcels of land back from 1MDB at sums astronomically higher than the RM230 million paid by 1MDB to acquire the 70 acres from the Government?

We call on MOF and 1MDB to confirm and disclose the details of the purchases of the land in TRX above. As wholly-owned companies under the Government, the public deserves to know what is being done with their own money.

Writing on his blog on Wednesday, 28 December, Dato’ Seri Salleh Keruak boasted that the Malaysian economy was in fact very doing very well because our GDP per capita, according to the CIA World Factbook stood at US$27,2000, which was much better than those of neighbouring Thailand, Indonesia, the Philippines, Vietnam, Myanmar and Laos.

More importantly, he claimed that our poverty rate was the “lowest in South East Asia” at 3.8%. He further added that he was grateful because our poverty rates are “drastically lower” than the poorest countries namely Syria, Madagascar and Zimbabwe with poverty rates above 70%.

Have we really gone so low today that we now need to compare ourselves with the poorest countries in the world today to make ourselves feel good for the new year? What has happened to the times when we pride ourselves to be among the Asian Tigers, being quoted in the same breath as South Korea, Taiwan and sometimes even Singapore and Hong Kong?

What’s more, the Information and Communications Minister can’t even gets his fact right, intentionally or otherwise. It appears that he has conveniently erased both Singapore and Brunei, with substantially higher GDPs per capita at USD77,500 and USD87,800 respectively off the map of Southeast Asia.
And even when he did get his “facts” right when compared to Vietnam, Indonesia, Thailand, Laos, the Philippines and Myanmar, he also conveniently forgets to convey the fact that our neighbours have been enjoying significantly higher growth rates in the recent years.

Curiously however, Dato’ Seri Salleh Keruak chose to quote the CIA Handbook statistics, instead of the more authoritative World Bank. If Salleh Keruak were to believe the CIA Handbook statistics, Malaysia should already immediately declare itself a “developed nation”, ahead of the Vision 2020 target. Does the Minister actually believes that the average monthly income of Malaysians today is in excess of RM9,000?

A check with the World Bank Report – which is consistent with Malaysia’s own Department of Statistics, our GDP per capita is only US$9,500, barely a-third of the Minister’s boast! So why did the Minister decide to quote an unbelievable source and not that of our own Department of Statistics or the World Bank?

Instead of trying to glorify Malaysia’s superiority to countries like war-torn Syria and Zimbabwe, or even the Southeast Asian backwaters of Laos and Cambodia, Dato’ Seri Salleh Keruak should instead explain why Malaysia has fallen so far behind countries like South Korea and Taiwan?

In 1966, 10 years after achieving independence, Malaysia’s GDP per capita was triple that of South Korea? The latter overtook us in 1990 and today, based on World Bank figures, South Korea has a GDP per capita of US$27,500 (2016) which is more than triple that of Malaysia today.

Why have we lost competitiveness to our Asian Tiger peers in the 1980s and are now threading water above countries which are rapidly catching up like Vietnam and Indonesia? This is the real question which Dato’ Seri Sallleh Keruak and the BN administration must answer, and not continuing to pull the wool over the rakyat’s eyes.

Wednesday, January 03, 2018

On December 19, Datuk Zaid Ibrahim’s book ‘Assalamualaikum: Observations on the Islamisation of Malaysia’ was banned under the Printing Presses and Publications Act (PPA). As usual, only official reason given for this ban is that the book is "likely to be prejudicial to public order as well as public interest and is likely to alarm public opinion".

The addition of ‘Assalamualaikum’ to the growing list of books banned by the Malaysian government is proof of the government’s outright disregard for freedom of expression and ideas in Malaysia.

According to Zaid, the Home Ministry did not explain or consult him before banning his book nor was he even informed that the book would be banned. It goes to show the immense and arbitrary power that the PPA accords the Home Ministry to ban these without any clear reasoning.

Such curt excuses to ban books certainly harks back to the Stalinist or Maoist regimes where any forms of expression, whether in writing or in art, which are deemed prejudicial to the interest of the ruling elites are banned.

In 2017 alone, 44 gazettes have been issued to ban publications in Malaysia. Among the political titles banned are civil society group G25’s new book Breaking The Silence: Voices of Moderation; Islam in a Constitutional Democracy and reknowed academic Professor Farish A. Noor’s From Majapahit to Putrajaya, which was published in 2005.
The banning of these titles without any clear justification shows that the government exercising totalitarian control over what ideas can be discussed by Malaysians. This goes completely against the values of democracy that our country holds so dear.

In a democratic state, the authors and publishers would be hauled to the Courts to be charged for any criminal offences which may have taken place. Even if there were no criminal elements involved, the Government must at the very least provide facts and justifications to prove the contents of these books to be wrong.

However, the BN regime will not even pretend to rebut the arguments carried in the book, however feeble the rebuttals might have been.

Just last month I had questioned the government’s censorship of arts following the confiscation of works at the KL Biennale for purportedly containing ‘elements of communism’. It seems that the thought policing of our government will continue with the banning of these books and the continued censorship of our media.

We call upon the Home Affairs Minister to prove that Malaysia is not taking great leaps to undermine democratic principles enshrined in our Federal Constitution, in remaking Malaysia into a communist state.

Saturday, December 23, 2017

During the objection hearings to the new voters being transferred to Segamat’s still unbuilt army camp, an Election Commission (EC) registrar had rejected the Parliament Hansard as evidence saying that it “cannot be believed”.

The objections are being raised in regards to the inclusion of 1079 new army voters in the Segamat constituency as list in the EC’s third quarter supplementary electoral roll. The ongoing issue had been raised by Kluang MP Liew Chin Tong because the new army camp in Segamat is not even complete but the army personnel and their spouses have already been added to the electoral roll in that constituency.

During the Budget debate in Parliament on November 27, Seremban MP Anthony Loke had asked for confirmation if the army camp was still under construction or if it had been completed.

In response the Deputy Minister of Defence, Datuk Johari Baharum said that the camp was still under construction and when question further, said that the camp was not complete. As recorded on page 136 of the Hansard, the Deputy Minister said “belum siap” when asked to confirm the status of the army camp.

Yet, the registrar chose to reject the Hansard as evidence. This is a clear case of contempt against the Parliament.

The Parliament Hansard is the official record of Parliamentary proceedings. Even in court, Parliamentary proceedings are admissible as evidence. Section 78 (1b) of the Evidence Act 1950, which states the proof required for official documents, states that

…the proceedings of Parliament or of any of the federal legislatures that existed in Malaysia before Parliament was constituted or of the legislature of any State— by the minutes of the body or by the published Acts of Parliament, Ordinances, Enactments or abstracts or by copies purporting to be printed by the authority of the Government concerned.

The Act clearly says that Parliamentary proceedings are proved by the minutes of the session, which takes the form of the Parliamentary Hansard and nothing else.

If the judiciary accepts the Hansard as hard evidence, who is the EC to reject the official Parliamentary document? For the EC registrar to say that the Hansard cannot be believed, they are saying that Parliament proceedings themselves cannot be believed.

We call upon the Speaker Tan Sri Pandikar Amin to reprimand the Election Commission for the latter’s contempt and we call upon the EC to reprimand the responsible Registrar above and immediately act to rectify the injustice by reopening the objection proceedings in Segamat.

The failure of the EC to do the above would only further prove that the EC is not the independent institution conceived by our Constitution. Instead, it is merely a paw of Barisan Nasional.

…when klia2 began operations, it had the same PSC rates as the LCCT, despite having far superior services and facilities. This environment is non-sustainable, given that the costs of operating and maintaining a larger and more advanced airport are higher.

Indeed, we have long criticised and warned the Government on the inflated costs and questionable decisions made by MAHB in the construction of KLIA2 which will inevitably result in subtantially higher operating costs. The higher cost however, isn’t quite due to MAVCOM’s description of a “more advanced airport”.

Firstly, it is due to more than RM5 billion worth of borrowings MAHB took to finance the airport which today incurs more than RM250 million in interest per annum.

Secondly, it is due to MAHB incompetence and questionable decisions which have resulted in substantially higher than expected maintenance cost. Despite KLIA2 commencing operations since 2013, the airport is still plagued with soil settlement or sinking problems causing constant operational inconvenience and a state of perpetual repair.
For example, in August this year, urgent repairs had to be carried out at the KLIA2 runway due to soil settlement problems, forcing dozens of outbound and inbound flight delays. In October last year, a ruptured fuel pipeline – not the first time – was estimated to have taken one and a half months to rectify.

Most obviously, and the biggest complaint by both Air Asia as well as passengers is the unnecessary grandeur in the sheer size and scale of the airport. This has resulted in extra-long walking distances for airline workers and passengers. As a result, MAHB was forced to retrofit poorly designed walkalators all around the terminal to ease the inconvenience. Hence perhaps in this particular instance, MAVCOM is indeed correct to point out that the larger airport is indeed more costly to maintain.

Regardless, the admission by MAVCOM confirms that a key reason for the hike in PSC, also known as the airport tax, is to bailout MAHB which is suffering from losses in its KLIA2 operations. It should be remembered that the Chief Financial Officer of MAHB, has assured the Public Accounts Committee that MAHB does not need to raise the PSC above and beyond the prescribed inflation rates to ensure operational profitability. That has clearly turned out to be a lie.

We will not object to a hike in PSC if it is pegged to the annual inflation rates. However, a hike amounting to 46% to RM73 per international passenger is unacceptable, especially since it is to make the rakyat pay for the follies of MAHB.

It is worse when Malaysians see how biased MAVCOM is, when the latter is prepared to even revise history to justify the above hike.

MAVCOM reiterated to The Malaysian Insight that “KLIA2 was never designed as a low-cost carrier terminal and was not a “hybrid airport” as some claimed”. There cannot be a greater lie coming from the airline industry regulator which was born only a few years after KLIA2 commenced operations.

KLIA2 was conceived and intended to service the low-cost carrier airlines. Even the official brochure on KLIA2[2] on the MAHB website site still clearly states so. And when the cost of the airport ballooned to RM4 billion from the original budget of RM1.7 billion, it was the Deputy Transport Minister, Datuk Aziz Kaprawi who told both the media and the Parliament in 2013 that KLIA2 was not merely a ‘low-cost carrier terminal’ but a ‘hybrid airport’.

Is MAVCOM telling us that both MAHB and the Transport Minister had lied about the nature of KLIA2?

Let me advise the MAVCOM to download a copy of the Public Accounts Committee Report on KLIA2[3] for its commissioners to read and better understand the shenanigans which have taken place during the design, award and construction of KLIA2. Only then perhaps, Malaysians can hope that MAVCOM will stop punishing tax-payers to save MAHB’s skin.

Malaysia Airports Holdings Bhd (MAHB) has been quick to often cite the International Civil Aviation Organisation’s (ICAO) ‘principle of non-discriminatory pricing of passenger service charges’ when responding to criticisms against the equalisation of the fees between KLIA and KLIA2.

Earlier this month, it was announced that the Passenger Service Charge (PSC) for international flights, excluding ASEAN, operating at KLIA2 would be increased from RM50 to RM73 per passenger. The move by the Malaysian Aviation Commission (Mavcom) has drawn the ire of users of KLIA2, including the airport’s main airline AirAsia. The PSC increase which comes into effect on January 1 2018, will likely lead to an increase in airfares for flights using the supposedly low-cost terminal.

However, MAHB is only being selective in using the above non-discriminatory principle as an excuse to raise the PSC for KLIA2.
If one were to refer to the ICAO’s Policies on Charges for Airports and Air Navigation Service (attached), MAHB conveniently forgets to mention that the same policy still allows for differential pricing systems.

ICAO specifically says that “in general, aircraft operators and other airport users, including end-users, should not be charged for facilities and services they do not use”.

Hence MAHB is clearly violating this guideline when it increases the PSC at KLIA2.

This is very simply because the facilities and services provided at KLIA2 are vastly inferior to KLIA. And that in turn is because KLIA2 was never intended, designed or built as an extended “second permanent terminal for KLIA”. KLIA2 was conceived and always intended as an international hub for low-cost carriers, and was built to cope with the growth of AirAsia as the region’s fastest growing low-cost airline.

Because of the massive cost overruns as a result from MAHB incompetence, as concluded by the Parliamentary Public Accounts Committee (PAC), KLIA2 was relabelled as a ‘hybrid terminal’ in 2013. Even so, that relabelling still confirmed that after its opening in 2013, KLIA2 was unique and distinct from KLIA.

Therefore the latest claim by MAHB that KLIA2 is merely a “second permanent terminal for KLIA” to justify the hike in PSC is wholly untenable.

Hence, we call upon both MAHB and the Malaysian Aviation Commission (MAVCOM) to retract the decision to 46% hike the PSC charges at KLIA2 to equal that charged in KLIA. ICAO clearly allows for fee differentiation between airports and terminals based on the availability and quality of services offered.

If MAHB and MAVCOM insist on hiking the fees at KLIA2, then they must prove how KLIA2 is an equal to KLIA to the angry Malaysians out there. If they fail to do so, then it cannot be clearer that the entir fee hike exercise is to make more profits for MAHB, particularly since MAHB has taken billions of ringgit of debt to fund its RM4 billion KLIA2 misadventure.

Monday, December 18, 2017

Yesterday, Minister in the Prime Minister’s Department Datuk Seri Abdul Rahman Dahlan once again tried to deflect questions and criticisms of the RM55 billion ECRL project by painting it as “a domestic investment with foreign funding”.

This was in response to the statement issued by former Finance Minister, Tun Daim Zainuddin who responded to questions from the media last weekend on whether the country should be worried over foreign investments from China.

“How much investment did they bring in? Like Forest City? Does the train project (ECRL) bring in money?,” he asked

“If it is a loan, that means we have to pay (it) back. If you have to pay (it) back, does that mean it is an investment? If you were an investor, what would you say? Its not (an investment). It’s a loan,” Tun Daim explained.

Dato’ Seri Rahman Dahlan then retorted in his statement, “Would Daim and Bersatu be happier if foreigners own and operate the ECRL instead?”

The Minister who is in-charge of the Economic Planning Unit (EPU) is trying to be disingeneuous in his response.
While the fact of the matter is that ECRL is indeed an infrastructure project which funded with foreign debt, the Prime Minister Dato’ Seri Najib Razak himself, together with many other Cabinet Ministers have often used the project as a successful example of Malaysia’s ability to attract sizeable investments from China.

For example, earlier in January this year, Dato’ Seri Najib Razak defended “investments” from China, stating that “This is unfair, because investments from China benefits the nation including us in Pahang, not only large investments like ECRL but the price of palm oil also go up, to simultaneously profit smallholders and settlers,” he said said this at ‘An Evening With the Chinese Community In Pekan’ programme.[1]

Hence Tun Daim is merely trying to correct the ‘managed’ perception that these large infrastructure projects are not ‘investments’ from China, but are effectively huge debts which have to be repaid by Malaysians in the future.

The question isn’t where former Prime Minister, Tun Dr Mahathir Mohammad or Tun Daim or any Malaysian for that matter, “be happier if foreigners own and operate the ECRL instead”.

Instead, Malaysians would “be happier” if the ECRL project was tendered openly and competitively so that our tax-payers will receive best value for our ringgit. Why was a infrastructure project of this magnitude awarded directly without any competitive tender? Hence, it begs the question - who will really profit from this contract?

It has already been exposed that the Government’s own appointed engineering consultants, HSS Integrated (HSSI) has estimated in December 2015 the project's value was RM29 billion (RM53.2 million per km), whereas China-owned China Communications Construction Company (CCCC) was awarded the contract at RM55 billion (RM91.7 million per km).

We have demanded for the HSSI to be publicly disclosed and Transport Minister, Dato’ Seri Liow Tiong Lai has promised in Parliament in November 2016 to “publish” the feasibility study when it is “finalised”[2]. However, the HSSI report remains a secret document with the BN Government.

The question which remains unanswered to date – if ECRL were to cost RM30 billion or less, why was CCCC awarded the contract via direct negotiation for RM55 billion, even if there so-called favourable financing terms? Where would the excess RM25 billion go to? Would it be used to pay-off some of 1MDB’s debts as speculated so as to cover up the Najib administration’s largest international financial scandal?

MAHB insisted that “KLIA2 is not a low-cost airport terminal”. It said “together with the government, we had made the strategic decision to build a second permanent terminal for KLIA that will accommodate increased capacity requirements, or in other words, future growth”.

So not only is KLIA2 not a “low-cost terminal”, it also appears that MAHB is now ditching its own much-ridiculed “hybrid airport” moniker. Deputy Minister of Transport Datuk Abdul Aziz Kaprawi had announced in July 2013 that “KLIA2 will no longer be a low-cost terminal, but Malaysia’s first hybrid airport with upgraded business-class services alongside total international passenger segregation”. The announcement was made partly to justify the astronomical increase in the cost of the terminal from RM1.7 billion to more than RM4 billion.

Malaysians are rightly confused with the shifting terminologies and inconsistent definitions of what exactly is the purpose and intent of KLIA2.

If you were to download the brochure from MAHB’s own website, “KLIA2 – The Rise of the New Titan”[1], it clearly states

…KLIA2 is positioned to be the biggest terminal for Low Cost Carriers (LCC) in the world, serving as a global benchmark for future terminals of its kind…

With these world-class features, KLIA2 will be the largest purpose built terminal for low-cost travel in the world with a capacity of up to 45 million passengers per annum…

So which is right? The marketing brochure on MAHB’s website or the latest statement to deflect blame from the massive hike for Passenger Service Charge (PSC) at KLIA2?
However, regardless of whether MAHB wants to call KLIA2 a “hybrid airport” as it did earlier in 2013, or a “second permanent terminal for KLIA” as it did yesterday, the fact remains that KLIA2 has at all times since its approval by the Cabinet, been intended specifically to serve as a new “low cost carrier terminal” to replace the old makeshift LCCT.

The fact of the matter is, MAHB had only decided in 2013 to re-label KLIA2 as a “hybrid airport” in order to justify the massive unbudgeted cost overruns and delays. Now, MAHB is redefining KLIA2 as merely a “second permanent terminal of KLIA”, implying no differentiated service quality between KLIA and KLIA2, purely to justify the equal PSC to be imposed both terminals.

It is ironical that MAHB claimed that it has already explained the above to the Public Accounts Committee (PAC), of which I am a member. MAHB said in its statement yesterday

We have also explained numerous times to YB Tony Pua along with the other members during the PAC sessions that after numerous engagement sessions with key stakeholders, klia2 development had undergone significant scope increase due to changing requirements by the key stakeholders, including the government agencies and AirAsia.

MAHB seems to have forgotten that the damning PAC Report on MAHB concluded that the excuses given by the top management of MAHB were misleading, untenable and unjustifiable.

The then PAC chairman, Datuk Nur Jazlan Mohamed said MAHB was “not being customer-centric” when “MAHB should be building airports for people to use and not determine what people should use”. The PAC had strongly criticised MAHB’s arrogance for intentionally abstaining from engagement with its key customers like Air Asia when designing and constructing the airport.

The PAC Report had concluded that “Malaysia has lost a golden opportunity to develop the most competitive low-cost carrier hub in the Asia Pacific region.” Today, Malaysians have to pay for the follies of MAHB with a massive 46% hike in Passenger Service Charges.

Just when you think that MCA could not sink any lower, MCA President Dato’ Seri Liow Tiong Lai beats all expectations by jumping on the bandwagon to demonise Lim Kit Siang as a potential Prime Minister.

His statement recycles the same fake news that is being peddled by UMNO and PAS that Lim Kit Siang will become Prime Minister if the Opposition wins the next election. Kit Siang has already said time and time again that he has no intention of becoming Prime Minister, yet the government seems to have run out of ideas to promote itself that it is relying on its tired propaganda of portraying him and the DAP as the only party in the Opposition.

It has long been the weapon of UMNO President, Dato’ Seri Najib Razak and his merrymen to threaten the Malays with losing power. During the ruling party's Annual General Meeting earlier this month, Wanita Umno Chief Dato’ Seri Shahrizat Abdul Jalil warned that voting for Pakatan Harapan would lead to rule by “Emperor Lim”.

It is a weapon to diminish the importance the Malay voters will place on the outrageous scandals and misdeeds which have been carried out against Malaysians. These would include tens of billions of ringgit worth of shennanigans in government ministries and state-owned enterprises like 1MDB, FEDLA, MARA and Tabung Haji. The diversionary lie is also to distract voters from feeling the pain of rising prices, the Goods & Services Tax (GST), weak ringgit and a stagnant economy.

Most uncannily, Liow Tiong Lai’s statement comes right after PAS President Abdul Hadi Awang took a similar position to support UMNO last weekend.
“In fact, for DAP leaders to become the prime minister if the opposition front wins the 14th general election (GE14) goes against the reality in Malaysia, where the concept of an Islamic country means Islam must be in power. This is important. We want to maintain the leadership of Muslims in this country,” Hadi was reported telling Berita Harian in an interview.

Perhaps it should not have come at a surprise that MCA is now so desperate that it felt the need to peddle the same fear mongering rhetoric as PAS. Liow Tiong Lai also said that Lim Kit Siang was clever at sowing racial discord. In echoing the PAS President’s calls, has is Liow now admitting that there should never be a Malaysia for all Malaysians?

The MCA President must have finally realised that it has no hopes of recovering support from the non-Malay community. He is now hoping that by demonstrating subservience to UMNO and PAS, it can receive higher Malay support. This will ensure that MCA might be able to hold on the the handful of remaining seats it possess – such as his own in Bentong where he won with a wafer thin 379-vote majority.

There could not be a greater irony than a political party founded on the need to protect the interest of the Chinese community is now parroting the racially-tainted lies and propaganda espoused by the ‘Ketuanan Melayu’ extremists in UMNO and PAS.

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About Me

I was elected in March 2008, the Member of Parliament for Petaling Jaya Utara under the Democratic Action Party (DAP). I'm also the DAP National Publicity Secretary, as well as the investment liaison officer for the Penang Chief Minister based in the Klang Valley.

Before joining politics full-time in January 2007, I was the CEO and founder of a Malaysian IT company, publicly listed in Singapore. I divested all my shares in the company to be able to serve the community and take part in socio-political affairs of Malaysia.

I've always had faith that there has been a guardian angel looking after me all these while - my personal well-being, my education, my career. Some will call it "God's will", some "fate" while some others, "destiny". I strongly believe that it is time for me to repay the kindness and fortune showered on me by my family, the society and of course, not forgetting, my guardian angel. :-)